NEW DELHI (Reuters) - Protesters clashed with police on Wednesday outside the University of Delhi, where Gujarat Chief Minister Narendra Modi, a popular but divisive contender to run for prime minister within a year, was making a speech to cheering students.

The contrasting receptions inside and outside the packed hall highlighted how much the Gujarat chief minister polarises public opinion.

Modi, 62, is praised by both corporate India and a majority of voters in Gujarat for presiding over years of fast growth and clean governance, but his record is marred by deadly religious riots in the affluent state 11 years ago.

In December he won a fourth consecutive term in office, and since then many in his Bharatiya Janata Party (BJP) have called for him to lead the party in national elections due by early 2014.

But the memory of the riots, in which more than 1,000 mainly Muslim people were killed, means that even some key regional allies of the BJP fear Modi would alienate national voters.

Modi told more than 1,000 students in a sports auditorium at Shri Ram College of Commerce (SRCC) that Asia's third largest economy should focus on technology and manufacturing for export to improve its global standing.

"The whole world is looking at India as a big marketplace. Why? Because they (other countries) think they can sell here easily. It is the demand of our time to make India a leader in manufacturing and dump our goods in the world market," he said.

If Modi is nominated as the BJP's candidate he will likely be competing against Rahul Gandhi, heir to the Nehru-Gandhi dynasty, India's most powerful political family, as the man to take over the reins from Prime Minister Manmohan Singh.

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